RHJ Holdings, the Belgian industrial conglomerate, has increased its offer for the European business of General Motors (GM), raising the stakes for the control of Vauxhall, the British carmaker.

The Belgian group said yesterday that it had increased its cash offer for GM Europe by €25 million (£22 million) to €300 million for a 50.1 per cent controlling stake.

As part of an attempt to sweeten its offer, RHJ has also reduced the sum of state aid that it has requested from €3.8 billion to €3.2 billion and pledged to repay it by 2013 — a year earlier than had been proposed.

The Belgians’ move comes amid prolonged uncertainty about the future of Vauxhall and Opel, the car manufacturers owned by GM, the stricken American giant. As part of the terms of the US taxpayers’ bailout of GM this year, the Detroit-based carmaker promised the White House that it would sell its European business.

During the summer, GM considered two offers — from RHJ and from Magna International, a Canadian car parts maker — but two weeks ago, the new GM board indicated that it was considering retaining the European business. The board, which is split over the issue, is to meet on Tuesday and Wednesday next week to discuss the future of Opel and Vauxhall. While it is unclear whether they hope to reach a final decision, the move by RHJ is clearly aimed at trying to influence the American parent before that meeting.

Magna declined to comment yesterday on whether it, too, was preparing to raise its offer.

The uncertainty over the final ownership of GM Europe leaves the 5,500 workers employed by Vauxhall in Britain under a cloud. Vauxhall has two main plants in the UK: one in Ellesmere Port, Cheshire, where it makes the Astra model; and another in Luton, where the Vivaro small commercial van is produced.

British union officials expressed deep concerns yesterday about the Magna bid. They are worried because the Canadians have refused to commit to the Luton plant beyond 2013.

In addition, there are concerns about an apparent clause that governs the terms under which Renault, the French carmaker, is bound to the Luton plant. Renault has a manufacturing arrangement with Vauxhall in Luton, but there are fears about the French group’s position regarding the future ownership of Vauxhall. Last month, it emerged that Vauxhall was so concerned about the outcome of negotiations that it was taking the advice of insolvency experts.

Both Magna and RHJ are keen for state aid from both the German and British governments in return for commitments over the future size of Opel and Vauxhall workforces.

However, there are now concerns about the sums being earmarked by Angela Merkel, the German Chancellor, to protect German workers and worries that state aid offers may trigger concerns in Brussels. Mrs Merkel wants to secure a deal before German national elections this month. Over the weekend, the Chancellor’s conservative Christian Democrat party suffered defeats in two key regional elections.

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